SECTION 10 A SUBSECTIONS (2-4)

10A(2):
this section talks about an undertaking established in:
1. FTZ free trade zone, provided that the undertaking in such free trade zone commenced business on or after 1.4.1981.
2. EHTP or STP, namely electronic hardware technology park or software technology park, provided that such undertaking commences business on or after 1.4.1994 in such STP or EHTP.
3.SEZ, provided that such firm commences business on or after 1.4.2001.
therefore the benefit of this subsection shall be availed provided that the undertaking fulfills the above condition. therefore a question arises, is there a necessity of registration for the above preceeding the condition?? i.e. should an undertaking be registered as a STP or SEZ or FTZ before fulfilling the conditions specified above?? this is an interesting line of thought having certain litigations. The whole subsection is silent about the date of registration for such undertakings under the relevant types of havens, hence the same shall be interpreted that if the registration succeeds the commencement then the condition of commencement of business on or after the above mentioned dates shall be the criterion for determining the exemption for such undertakings. therefore on commencement of business the registration shall be with retrospective effect from the date on which the commencement began under the respective havens.
the undertaking shall not be formed out of splitting up or reconstruction of an exisiting business undertaking. but this condition shall not apply, ie the undertaking shall be formed out of reconstruction or rehabilitation or revival of an undertaking restricted to conditions specified u/s 33B (which shall be discussed in detail separately).
the undertaking shall not be formed by transferring to a new undertaking a plant and machinery used by an existing undertaking.
thus an undertaking shall have to compy with the following to be eligible for the exemption under this section.

10A(3)
this section talks about the condition following the receipt of consideration for the sale of goods or articles or computer software. all such sale proceeds shall be brought into india or shall be received in India in convertible foreign exchange within a period of 6 months or as per the period specified by RBI or such other authority as per any law under force for regulating and dealing in payments. if such sale proceeds are received outside of india the same shall be deemed to be received in india if the sale proceeds are credited to a separate account maintained for the purpose by the assessee with any bank outside india with the approval of

10A(4)
this section talks about the proportionof deduction availed under this section for the havens. it specifies that profits derived shall be exempt in proportion to the ratio of export turnover tothat of total turnover, which means if the total turnover is 10 lakhs and if the export turnover is 8 lakhs then the exempted export profits shall be =8lakhs/10lakhs(8lakhs) therefore the exemption u/s 10A shall be Rs. 6.4lakhs. therefore the exemption shall be inproportion to the domestic to export turnover.